Cooper Union, founded by Peter Cooper to give free education to those who couldn't afford it, would change fundamentally as an institution under a plan to charge incoming freshmen tuition this fall, opponents of the concept charge. (Hidalgo, Carolina FREELANCE NYDN)

REAL ESTATE honcho Jeff Gural once offered to donate millions of dollars to Cooper Union to stall — and possibly to prevent — a plan to impose tuition on students for the first time since 1902, it was revealed on Friday.

The board of trustees of the 155-year-old school, which has instituted tuition to cover an operating deficit ranging from $13 million to $23 million, rejected the offer by Gural, chairman of Newmark Grubb Knight Frank , a real estate management firm.

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The disclosure came as lawyers for the prestigious school — one of the nation's few remaining tuition-free colleges — appeared before a Manhattan judge who has been asked to block the tuition plan, which goes into effect this fall for freshmen.

Richard Emery, lawyer for a group called the Committee to Save Cooper Union, said the charter and trust that govern Cooper Union require the trustees to provide a tuition-free college education in art, architecture or engineering — unless a judge allows a change to the policy.

"There is no ambiguity about the intent of the grantor or trust — Peter Cooper wanted a free school," said another Committee lawyer, Zoe Salzman, referring to the industrialist who gave his fortune to create the school in 1855. Cooper Union, located in lower Manhattan, has not charged tuition since 1902, thanks to a gift from Andrew Carnegie.

Emery argued that poor investments and misspending by Cooper Union's leaders resulted in the budget gaps. He said the shortfalls can't be closed by charging tuition without serious consequences, including the possible loss of tax-free status on the school's main income-producing asset — the land along 42nd St. on top of which the Chrysler Building sits.

Emery said the trustees are bent on creating "a little Swarthmore on Astor Place," and spurned an offer by Gural to cover the revenue that would be generated by the first year's tuition, roughly $8 million.

Gural, a member of the school's board, told The News in a telephone interview that Emery overstated what he had offered. He said he thought the board needed more time to study other solutions, so he proposed a three-part, short-term solution: raise the mandatory student fee for all students, from $1500 a year to $5000 a year; freeze faculty salaries for two years; and have alumni raise the remainder.

Gural said he promised to fill the gap if those options fell short. He said he had been willing to pay as much as $2 million.

"I've been on the board a long time. I made the offer because they needed more time to study a report," Gural said. Earlier, he said, he donated $1 million so Cooper Union could continue to offer high-quality Saturday art instruction to city kids who can't afford to pay for classes.

Jeff Gural, a prominent NYC real estate executive who sits on Cooper Union's board of trustees, offered to pay up to $2 million to cover expenses if the tuition plan were postponed. (LESLIE BARBARO)

A school source said Gural's plan was rejected, and the board voted to impose tuition, because the offer didn't cover the entire deficit; it was contingent on union givebacks and substantial fund-raising.

"The board felt we were kicking the can down the road, and we should bite the bullet on tuition," the source said.

Cooper Union attorney Barbara Mather argued in court Friday that the alumni, faculty and students who brought the lawsuit have no right to sue because, under New York State law, only the attorney general, not potential beneficiaries, can challenge the way a trust, like Peter Cooper's, is administered.

State Attorney General Eric Schneiderman has not taken a position on the tuition fight.

Claire Kleinman, an incoming freshman who had a deadline of Thursday to pay her first tuition installment, said that if the tuition plan sticks, it will change the school's character, because many poor and middle-class student's won't apply.

"It changes the whole dynamic," said Kleinman, a graduate of Fiorello H. LaGuardia High School of Music & Art & Performing Arts, on Manhattan's West Side.

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Kleinman said she will not have to pay the $20,000 annual tuition, which is the most being charged to any freshman, because she has outside scholarships. She declined to say how much she will have to pay.

Manhattan Supreme Court Justice Nancy Bannion did not indicate how long she will take to rule on the case.

The school has about 1,000 undergraduates. Its graduates include Thomas Edison, the late Supreme Court Justice Felix Frankfurter, Nobel Prize-winning physicist Russell Hulse and Daniel Libeskind, the architect who designed the newly rebuilt World Trade Center.